What to do in the conditions of the slow economy?
- by Anna K.
3 steps to take in slow economy
As we talked yesterday, according to predictions of the financial experts, in 2019 international economy is going to slow down this year. Which is clearly not a god piece of news for us.
Although some of us might have started preparing ourselves for this, it is still hard to swallow. Plus, it seems that even slower economy Is just plain economic crisis. But still, even under the condition od crisis markets we are going to have to stay afloat. But how? Here are things that we can do if economy slows down.
1. Get income from dividends.
Decline in economy and bull market doesn’t necessarily mean dying out for all of the sources of income. With the decline for bull market, dividends actually are going to increase. It is usually coming as a result of various companied trying to satisfy shareholders who are preferring to stay away from the selloffs even though the growth pace is extremely slow.
Plus, we already have an experience of that happening. In 2015. But we are not here to talk about that. We are here to talk about wat to do is the economy slows down.
In conditions of the bear market it is better to look for other investment and trading opportunities. Try turning your heads towards ETFs and mutual funds. That ought to grasp your attention. Plus, dividends are a good way to get some passive income – and who doesn’t like getting money without having to work?
2. Look into private market.
Public and private sectors of the market are not that much different, except for the fact that in the private market, true to name, transactional are conducted one-to-one – seller to buyer and company to buyer. And private market doesn’t mean that there are only boring securities there. One can trade equities, real estate and angel investings in this sector of the market.
But, there are some disadvantages to this sector. For example, private market is not nearly as transparent as the public one. It is also less liquid, which can actually be a good thing for those who prefer to long. But, the biggest disadvantage of them all is the fact that private companies can fail more rapidly than the public traded ones.
But, the fact that due to the devotion of the investors who might be longing the shares for years to public companies have more chanced to withstand hard times than the more liquid public ones.
3. Do not forget short trading.
If the market slows down as well as the short trading it doesn’t mean that we need to kill it off. On the contrary. We just need to pay more attention to it. We need to diversify and treat it more tactical. In fact, that is a good rule for any type of market – bear or bull – pay more attention to your trades.
Also, and this point concerns every entry on our list is that we need to always remember our history. And I am not talking about your possible private history of trading. I am talking about the history of the world. For example, world economy lost value only once since 1945 – in 2009 when the great economic crisis stroke. It is safe to say that some of the countries, like Greece are still recovering from the consequence of it. that is why tight now we have no reason to panic, although it never hurts to look at the possible actions in case of another slow-down.
What will you do in case economy slows down?